Entrepreneurs who have affairs within the workplace, or even outside it, are likely to see their companies suffer.
Think your extra-marital affair or secret workplace relationship has no bearing on your company's success? You're wrong. Even if you aren't General David Petraeus, a hidden affair can do irreparable harm to your business, according to David Gebler, attorney and founder of the Skout Group, a consultancy that helps businesses avoid corporate scandals. He's also author of The Three Power Values.
These days when the line between work life and home life is increasingly blurry, you can't put up a firewall between the two and expect them to stay separate. "Your personal life may not seem like anybody's business--but it is, so get over it," Gebler says.
How exactly can an affair hurt your business? Here are five different ways:
1. You're telling employees that breaking the rules is okay.
Even if your affair is with someone unconnected to your company, if employees find out about it--and they will--they will get the message you believe rules don't apply to you. The culture of a company reflects its leader's values, so they may begin thinking that they too should break the rules.
2. They may question your judgment...
"You're asking people to trust in your decisions," Gebler says. "There's this expectation that as a leader, you're a pristine role model." If it looks like you've screwed up your personal life, both your employees and your board may wonder if the decisions you're making for the business are the right ones.
3. ...and they might be right.
"Conflict of interest creeps in," Gebler says. "Most leaders I've seen get into trouble because they start doing things like hiding expense reports, or justifying trips, or other decisions in order to spend time with the other person." Your affair will make it hard for you to focus, he says. And you might actually start making bad decisions.
4. You'll be accused of favoritism.
If you're having a relationship with someone within the workplace, you almost inevitably will be accused of favoritism. "Let's say a senior leader is having a relationship with a high-performing superstar," Gebler says. "That person will always be tainted. People will say, 'That's the boss's lover--of course she got the promotion. In tough economic times when you need your team to be 100% focused on the job at hand, this kind of office soap opera creates a distraction."
5. You will probably get sued, even if you think you won't.
In his experience, Gebler says, executives who feel certain their lover would never file a harassment suit are often proved wrong. It's one more piece of self-deception to think that because your affair is going so smoothly right now, you and your lover will part on friendly terms when the time comes. It may not work out that way, Gebler says. "If the relationship ends badly, the angered subordinate will often bring a harassment suit."